us shrimp case analysis

8/12/2019 US SHRIMP CASE ANALYSIS

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available at: http://www.worldtradelaw.net/articles/howseshrimp.pdf

Copyright (c) 2002 Columbia Journal of Environmental Law

2002

27 Colum. J. Envtl. L. 491

Robert Howse

The Appellate Body Rulings in the Shrimp/Turtle Case:

A New Legal Baseline for the Trade and Environment Debate

I. Introduction................................................................................................................................................................1

II. Background to the AB Rulings in Shrimp/Turtle......................................................................................................3

III. Understanding the Appellate Body Rulings ............................................................................................................5

IV. Policing Unilateralism Through the Conditions in the Chapeau .............................................................................9

V. Country-by-country vs. Shipment-by-Shipment Certification................................................................................12

VI. Criticisms of the AB rulings in Shrimp/Turtle ......................................................................................................15

I. INTRODUCTION

The most fundamental and divisive issue confronting the WTO in the trade/environmentdebate has been whether trade restrictions to protect the environment are permissible under the

law of the GATT/WTO system. Although some multilateral environmental agreements require

trade restrictions in order to be effective (the Basel Protocol on Hazardous Wastes, n1 forexample), unilateral trade measures in response to other countries' failure to protect the

environmental commons are hardly an adequate overall solution to environmental problems. n2There is consensus in the environmental movement that international cooperation is the best

strategy for protection of the global environment. However, as Coase observed, n3 in a world

where bargaining imposes transaction costs, cooperative solutions will be affected bybackground legal rules that establish rights or entitlements on which the parties can rely in the

absence of negotiated agreement. It is possible that a rule that is highly restrictive of unilateraltrade measures to protect the environment will lead to strategic behavior, and exacerbate hold-out problems, thereby increasing transaction costs and reducing the likelihood of cooperative

solutions to global environmental problems. n4

It is thus not surprising that environmentalists began to turn their attention to the trading

system after a GATT dispute-settlement panel ruled that a United States embargo on non-dolphin-friendly tuna was illegal under GATT rules. The panel's ruling was particularly

disturbing because the scheme did not obviously n5 target imports; it was enforced in tandem


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Howse - Shrimp availabl e at: http: //www.worl dtradelaw.net/arti cles/howseshrimp.pdf

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with domestic regulations that required United States fishers to use dolphin-friendly techniques.

Article XX n6 of the GATT provides exceptions for measures that are "necessary" to protecthuman and animal life and health (XX(b)) and that are "in relation to" the "conservation of

exhaustible natural resources" (XX(9)). The Tuna/Dolphin panel held, however, that these

exceptions only applied to measures protecting resources within the territorial jurisdiction of the

enacting state.Widely criticized, the Tuna/Dolphin ruling n7 was never adopted as a legally binding dispute

settlement by GATT's membership. n8 Ignoring the text of the GATT treaty, the panel based its

decision on an intuition that trade measures to protect the environment might somehow open thedoor to "green" protectionism, thereby threatening the market access negotiated in the GATT

framework. A second Tuna/Dolphin panel, whose ruling went similarly unadopted, reaffirmed

the earlier panel's rule, but based its decision on somewhat different grounds. n9

Before the Tuna/Dolphin rulings, the prevailing view was that Article XX of the GATTdecided any conflicts between free-trade rules and environmental norms in favor of the latter.

n10 The Tuna/Dolphin panels tried to switch the preference in favor of the latter. Worse still,

they approached the question solely from the perspective of effects on liberalized trade.

Traditionally, the GATT demonstrated respect for regulatory diversity and progressivegovernment. But after Tuna/Dolphin, environmentalists - and others with concerns about how the

trading system balances competing values - saw the GATT as a regime dedicated to the triumph

of free trade over all other human concerns. n11

In the Shrimp/Turtle case, n12 the Appellate Body (AB) repudiated the Tuna/Dolphin panel'sapproach to trade measures to protect the global environment. The AB ruled that there is no per

se rule of impermissibility in the text of Article XX. Rather, the article imposes two requirements

on trade measures that condition market access on other countries' policies. First, such measuresmust fit within one of Article XX's specific exceptions. Second, such measures must be applied

in a manner consistent with Article XX's chapeau (preamble). That is, their application must

neither give rise to unjustified or arbitrary discrimination between countries where the sameconditions prevail, nor create a disguised restriction on international trade.

In Shrimp/Turtle, the AB held that the U.S. measure - which prohibited imports of shrimp

from any country that did not have a turtle-conservation program comparable to that of theUnited States - fit the Article XX(g) exception for conservation of exhaustible natural resources.

However, the AB also found that the U.S. measures had been applied in a way that violated the

chapeau: by treating certain Asian countries differently than its trading partners in the westernhemisphere, the U.S. had engaged in unjustified and arbitrary discrimination.

The AB report's subtle language and the fact that the ruling went against the United States'

application of its environmental scheme blunted the impact the decision could have had. At first,

few people fully appreciate that the AB was fundamentally changing the Tuna/Dolphin approachon the consistency of environmental trade measures with the multilateral legal framework for

liberalized trade. Indeed, some environmentalists feared (and some free-trade advocates hoped)

that the AB had made the standard for application of environmental trade measures so high thatthe net effect of its decision on the status quo as represented by the Tuna/Dolphin rulings would

be minimal.

In 2001 (3 years after its Shrimp/Turtle ruling), the AB clarified and elaborated on its

original holding. One of the Shrimp/Turtle complainants, Malaysia, had challenged the


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corrective measures the United States had taken in response to the AB decision. This second AB

panel held that the United States had brought its turtle-friendly trade measures into compliancewith Article XX, and it underscored those aspects of its original ruling that constituted a

fundamental departure from the Tuna/Dolphin approach. n13

My purpose in this brief essay is not to consider the Shrimp/Turtle ruling in light of the

policy-based critiques of the Tuna/Dolphin doctrine that I have developed at length in otherscholarship. Instead, I have two more modest objectives. The first is to clarify the legal meaning

of the rulings by the Appellate Body in Shrimp/Turtle, and particularly to address some

misunderstandings, rather widespread in scholarly commentary, as to exactly what the ABdecided, and especially what aspects of its ruling constitute valid legal precedent for future

disputes. The second is to address criticism from some quarters that, especially in reversing the

Tuna/Dolphin approach, the AB engaged in illegitimate judicial activism. Here, I shall argue

that, in fact, once the role of the Appellate Body in the new WTO system, and within the generalframework of international law, is properly understood, the decision could better be seen as an

example of judicial caution or conservatism.

II. BACKGROUND TO THE AB RULINGS IN SHRIMP/TURTLE

Several species of sea-turtles are endangered. n14 To protect these species, in the 1980s the

United States enacted measures to reduce the number of sea turtles killed by U.S. trawlers. The

most important measure was a requirement that every U.S. trawler fishing waters inhabited bysea-turtles be equipped with a Turtle Excluder Device (TED). In 1989, the United States

attempted to impose the TED requirement on shrimpers elsewhere in the world. n15

Section 609 contains several elements. First, it required the U.S. State Department to (1)

commence negotiations "as soon as possible" for bilateral and multilateral agreements to protectsea turtles n16 and (2) promote other international environmental agreements to better protect

sea turtles. n17 Second, it required the State Department to report to Congress within a year onthe practices of other countries affecting the mortality of sea turtles. n18 Third, it prohibited the

importation of any shrimp harvested using commercial fishing technologies that might harm sea-

turtles, unless the exporting country is certified by the U.S. administration as having a regulatoryprogram to prevent incidental turtle deaths comparable to that of the United States or is certified

as having a fishing environment that does not pose risks to sea turtles from shrimping. n19 Until

1995, the State Department had only applied the requirements of this section to the greaterCaribbean area, and did so on the basis of guidelines that permitted a country to be certified

where it adopted a program to require shrimpers to use TEDs on their boats; a country could take

up to three years to phase in the comprehensive program; further guidelines, issued in 1993,extended somewhat the final deadline by which a foreign country must implement its program in

order to be certified. In 1995, environmental NGOs challenged before the U.S. Court ofInternational Trade (CIT) the decision of the State Department to limit the application of Section

609 to the greater Caribbean area, as well as certain other interpretations that the StateDepartment had made of the law. n20

The CIT held that there was no statutory basis for limiting the law to the Caribbean region.

n21 In a subsequent court action, the State Department asked the CIT to extend the deadline for

application of the embargo to other countries beyond 1996, arguing that because this deadline


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would provide inadequate opportunity for other countries to adopt the measures necessary in

order to be certified, the result would be significant disruption of trade through the prohibition ofimports, and serious damage to U.S. policy interests. n22 The CIT denied this request. n23

This led the State Department to promulgate a set of guidelines for enforcement of the

statute, which permitted entry into the U.S. of shrimp that were declared to have been caught

with TED technology, even if the country concerned could not be certified as having a regulatoryprogram comparable to that of the U.S. These guidelines were in turn challenged by the plaintiffs

in the original action in further proceedings before the Court of International Trade. In this later

ruling, the CIT held that Congress had intended that the main operative provision of Section 609,which banned shrimp caught with commercial fishing technology harmful to endangered species

of sea turtles, in fact applied to all shrimp not originating from certified countries, regardless of

whether the imported shrimp themselves were caught by boats equipped with TED technology.

On the day the CIT judgment was rendered, India, Malaysia, Pakistan and Thailand took thematter to dispute settlement at the WTO. The United States chose not to dispute explicitly the

complainants' argument that the shrimp embargo was a violation of Art. XI of the GATT, which

bans non-tariff prohibitions or restrictions on imports and exports. The United States based its

defense of the measures strictly on the claim that they were justified under Arts. XX(b) or XX(g)of the GATT, which as noted above apply to measures, respectively, "necessary" for the

protection of, inter alia, animal life, and "related to" the conservation of exhaustible natural

resources.

While much of the legal argument of the parties, as well as their factual claims, addressedwhether the embargo could be justified under Sections XX(b) or (g), the panel chose to pin its

legal analysis exclusively on a consideration of whether the embargo satisfied the requirement of

the Article XX chapeau. The AB paraphrased the panel's reading of the chapeau succinctly:

If an interpretation of the chapeau of Article XX were followed

which would allow a Member to adopt measures conditioningaccess to its market for a given product upon the adoption by

exporting Members of certain policies, including conservation

policies, GATT 1994 and the WTO Agreement could no longerserve as a multilateral framework for trade among Members as

security and predictability of trade relations under those

Agreements would be threatened. This follows because if oneWTO Member were allowed to adopt such measures, then other

Members would also have the right to adopt similar measures on

the same subject but with differing, or even conflicting, policyrequirements. Indeed, as each of these requirements would

necessitate the adoption of a policy applicable not only to exportproduction ... but also domestic production, it would be impossible

for a country to adopt one of those policies without the risk ofbreaching other Members' conflicting policy requirements for the

same product and being refused access to these other markets. n24

The United States appealed this ruling, which ultimately led to the Appellate Body jurisprudence

that is the subject of this essay.


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III. UNDERSTANDING THE APPELLATE BODY RULINGS

In its first Shrimp/Turtle ruling, the AB did two things. First, it reversed certain key findings

of the panel, including the finding that the Article XX chapeau creates a per se exclusion of

unilateral trade measures to protect the global environment. Second, the AB went on to"complete the analysis" - an expression the AB has used in previous cases for the jurisprudential

technique of going forward to apply the law as correctly understood to the facts of the dispute.

This jurisprudential technique must be understood in light of the absence of any explicitauthority of the AB to remand a case to the original panel for re-decision in light of the AB's

clarification of the law.

The AB found three errors of law in the panel's treatment of the chapeau. First, the AB found

the panel had erred by considering the chapeau before investigating whether the measures couldbe provisionally justified under one of the heads of Article XX. Most notably, Article XX(g)

applies to measures "in relation to" the conservation of exhaustible natural resources. In a

previous case, Reformulated Gasoline, the AB had set out the proper approach to Art. XX, which

was to begin with a consideration of whether the measure could be justified under one of theheads of Article XX, and then only if there was such provisional justification, to consider

whether the party maintaining the measure was in compliance with the chapeau. n25 Clearly, the

Shrimp/Turtle panel had not followed this sequential approach to Art. XX analysis.

The sequencing of Art. XX analysis stipulated by the AB in Reformulated Gasoline, was notaccidental or arbitrary. Rather, it was directly linked to the AB's understanding of the chapeau as

directed to prevent abuse of a Member's rights under Art. XX. It is conceptually impossible to

know whether a Member is abusing their rights until those rights have in the first instance beendetermined.

The second error of law in the panel's approach to the chapeau was that the panel ignored the

fundamentally limited ambit of the chapeau. As the AB stressed in Reformulated Gasoline, thechapeau is concerned only with the application of measures, not whether the measures

themselves are justified under Art. XX. In Shrimp/Turtle, the AB reiterated this point:

In the present case, the Panel did not expressly examine theordinary meaning of the words of Article XX. The Panel

disregarded the fact that the introductory clauses of Article XX

speak of the "manner" in which measures sought to be justified are"applied." In [Reformulated Gasoline], we pointed out that the

chapeau of Article XX "by its express terms addresses, not so

much the questioned measure or its specific contents as such, butrather the manner in which that measure is applied"(emphasis

added)... . What the panel did, in purporting to examine the

consistency of the measure with the chapeau of Article XX, was tofocus repeatedly on the design of the measure itself... . The general

design of a measure, as distinguished from its application, is,

however, to be examined in the course of determining whether that


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measure falls within one or another of the paragraphs of Article

XX following the chapeau. n26

The AB might have disposed of the appeal based entirely on these findings of error of law in the

panel report. The result would have been a reversal of the conclusion by the panel that the United

States could not justify its measure under Article XX. In other words, the United States wouldhave "won" the case. It will be recalled that the Tuna/Dolphin rulings had been based not on the

chapeau of Art. XX, but on the notion of inherent territorial limits on the environmental

exceptions in Articles XX(a) and XX(b). Thus, had the AB simply reversed the panel andstopped there, the validity of the Tuna/Dolphin approach to environmental trade measures would

have remained a matter of uncertainty, to be decided presumably in future litigation.

Instead, the AB went on to find that the panel had made a third error of law, namely to

assume that unilateral measures that conditioned market access on the policies of the exportingcountries are, as a matter of general principle, not justifiable under Article XX. This was an

assumption common to the panel ruling in Shrimp/Turtle and to the older Tuna/Dolphin rulings.

In identifying this error of law, the typically cautious Appellate Body used emphatic language,

suggesting disapproval of the basic approach taken in Tuna/Dolphin as well as by the panelbelow in Shrimp/Turtle. The language of paragraph 121 of the decision is worth quoting at some

length:

In the present case, the Panel found that the United States measure

at stake fell within that class of excluded measures because Section

609 conditions access to the domestic shrimp market of the UnitedStates on the adoption by exporting countries of certain

conservation policies prescribed by the United States. It appears to

us, however, that conditioning access to a Member's domesticmarket on whether exporting Members comply with, or adopt, a

policy or policies unilaterally prescribed by the importing Membermay, to some degree, be a common aspect of measures falling

within the scope of one or another of the exceptions (a) to (j) of

Article XX... . It is not necessary to assume that requiring from

exporting countries compliance with, or adoption of, certainpolicies (although covered in principle by one or another of the

exceptions) prescribed by the importing country, renders a measure

a priori incapable of justification under Art. XX. Such aninterpretation renders most, if not all, of the specific exceptions of

Article XX inutile, a result abhorrent to the principles of

interpretation we are bound to apply. n27

With this holding, the AB rejected the traditional approach to environmental trade measures in

the GATT/WTO system, without so much as a citation to the unadopted Tuna/Dolphin panel

reports. Since the AB had already reversed the specific findings of the Shrimp/Turtle panel withrespect to the chapeau of Art. XX, and given the radical shift of perspective implied in these

words, some interpreted this paragraph as dicta, of uncertain legal significance in future cases.

But when the AB ruled on Malaysia's challenge to the U.S. implementation of its original ruling,the AB went out of its way to make clear that paragraph 121 was not dicta, but rather a


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fundamental basis of the original holding of its first decision. The later ruling reaffirmed that

paragraph 121 was intended to give legal guidance to future panels. n28

Having already done more than it strictly needed to do to reverse the panel in its firstShrimp/Turtle ruling, the AB went on to complete the analysis, showing how Article XX ought

to be applied to the facts of the case. The first stage in "completing" the analysis was to

determine whether the United States' measure was covered by any of the specific heads ofArticle XX. The United States had invoked Article XX(g) ("in relation to conservation of

exhaustible natural resources"), and in the alternative, Article XX (b), "necessary for the

protection of ... animal life." The U.S. preferred to make its case under XX(g) because itsrequirement of fit between measure and objective is less exacting than the one imposed by

Article XX(b).

In previous GATT jurisprudence, n29 "necessary" had been interpreted as triggering a very

high level of scrutiny: a measure could only pass muster if it used the least restrictive means toachieve its end. n30 The tendency of GATT panels had, however, also been to interpret "in

relation to" in XX(g) as not significantly relaxing the level of scrutiny determined by the

"necessary" language in XX(b). Breaking from this interpretive tradition, the AB in the

Reformulated Gasoline case held that the two phrases are not equivalent; there is a significantdifference in the closeness of connection suggested by the ordinary meaning of "in relation to" as

opposed to "necessary." n31 Based on Reformulated Gasoline, the United States understandably

preferred that its measures be considered under XX (g), rather than XX(b).

Conversely, the complainants preferred XX(b), with its necessity test. In this connection, thecomplainants argued that the expression "exhaustible natural resources" applied only to resources

incapable of biological reproduction - petroleum or coal reserves, for example. According to the

complainants, this definition of "exhaustible natural resources" represented the understandingcommon at the time that the original GATT was drafted in 1947. But the incorporation of GATT

into the WTO framework in 1994 created a new interpretive context that the AB was bound to

follow. The Preamble to the WTO Agreement, which established this new framework, referred tosustainable development as an objective of the WTO system. The AB therefore chose to interpret

the notion of "exhaustible natural resources" in light of evolving international legal instrumentsand policies to promote "sustainable development." These instruments and policies provided

ample evidence that endangered species are considered "exhaustible," despite individual

members of the species having reproductive capacities.

Inasmuch as they were threatened with extinction, the sea turtle species at issue wereconsidered by the AB to be exhaustible natural resources within the meaning of Article XX(g).

This finding is not necessarily incompatible with an "original intent" reading of the GATT.

Merely because the framers of the GATT may have thought of exhaustible natural resources interms of non-living mineral resources, it does not follow that XX(g) should be frozen by such an

understanding. In other words, the framers might have thought that living resources are notexhaustible, and they might have intended XX(g) to be interpreted in light of the evidence at the

time of the dispute concerning whether a given resource was exhaustible. On this interpretationof original intent, a finding that sea turtles are exhaustible based upon the evidence in 1998

would not be at odds with the framers' reading of Art. XX(g).

Moreover, a reading of "exhaustible" frozen in 1947 could easily lead to absurdity:

hypothetically, a WTO Member might end up being able to justify otherwise GATT-inconsistent


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Therefore, it should be sufficient, as required by the text of Article XX(g), that the U.S. measure

was even-handed, imposing a conservation burden on its own producers and consumers, and notmerely attempting to externalize the costs of environmental protection to the producers of other

countries.

IV. POLICING UNILATERALISM THROUGH THE CONDITIONS IN THE CHAPEAU

The overall boldness with which the AB rejected the bright line rule against unilateral

environmental trade measures seems to suggest that the AB simply gives short shrift to concerns

that such measures are susceptible to protectionist abuse or that they tend to impose on othercountries policy solutions that are ill-adapted to the particular conditions in those countries.

But a careful reading of the AB's application of the chapeau undermines this interpretation.

According to the AB, the chapeau's safeguards limit the damage that unilateralism can do to non-

discriminatory, rules-based trade. As the AB emphasizes, the conditions in the chapeau controlthe abuse of rights and they regulate the overall balance of rights and obligations struck by Art.

XX. However, interpreting the chapeau so as to vitiate the meaning of the rights contained in theoperative paragraphs of Art. XX would be inappropriate. Just as a bright-line rule againstunilateral environmental measures would make Article XX inutile, so too would an excessively

strict interpretation of the chapeau's conditions. Such an interpretation would make it impossible,

in practice, for unilateral measures to survive judicial scrutiny.

The AB has acknowledged the delicate nature of chapeau interpretation:

The task of interpreting and applying the chapeau is, hence,

essentially the delicate one of locating and marking out a line of

equilibrium between the right of a Member to invoke an exception

under Article XX and the rights of other Members under varyingsubstantive provisions (e.g. Art. XI) of the GATT 1994, so thatneither of the competing rights will cancel out the other[.]" n34

The AB found that the application of the U.S. scheme constituted "unjustifiable discrimination"

within the meaning of the chapeau. One element of unjustified discrimination was that while theU.S. refused to negotiate seriously with the complainants, it did negotiate seriously over this

issue with western hemisphere trading partners. n35 The failure of the State Department to

negotiate seriously with the complainants, in the manner that the U.S. negotiated with westernhemisphere countries, was a failure in application, since, as noted above in the discussion of the

background of this case, Section 609 itself contained a requirement to negotiate with all relevant

countries. Thus, this failure was appropriately considered under the chapeau, which deals withthe manner of application of a Member's scheme. The AB also found the application of the U.S.

scheme unjustifiably discriminatory on the separate grounds that (1) they were a rigid,

extraterritorial extension of U.S. law to other countries, and (2) they wholly disregarded theconditions prevailing in other countries. To be certified (and gain access to U.S. shrimp markets),

all countries were required to have a TED program essentially identical to that of the U.S.,

regardless of conditions in those countries. This was certainly discriminatory in comparison to

the agreement embodied in the Inter-American Convention for the Protection and Conservation


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of Sea Turtles, which allowed the specific circumstances of the exporting countries to be taken

into account in determining the means they adopted to satisfy the U.S. conservation objective. Itwas unjustified because, as the AB suggests, other measures more acceptable to the exporting

country might have achieved the legitimate conservation objective of the U.S. Indeed, as the AB

notes, this was already implicit in the scheme itself, which allowed for the possibility of

certification in the case of a turtle conservation program "comparable" (though not identical) tothat of the U.S.

Furthermore, the scheme as applied barred imports of shrimp caught with TEDs merely

because they were caught in waters of countries not certified by the U.S. Here the AB wascumulating the effect of country-based application with the effect of using a rigid, U.S.-derived

standard as the standard of country certification. Taken together, these two features of the

scheme's application lead to a conclusion of unjustified discrimination on the grounds that the

scheme's paramount concern was influencing WTO Members to adopt essentially the samecomprehensive regulatory regime as that applied by the United States to its domestic shrimp

trawlers. n36 Thus, the ultimate problem is not with country-based application as such, but

"when the measure at issue does not allow for any inquiry into the appropriateness of the

regulatory program for the conditions prevailing in those exporting countries." n37

Perhaps the most pervasive interpretation of the AB decision in Shrimp/Turtle is that the AB,

under the chapeau, imposed a duty to negotiate seriously as a pre-condition to the application of

unilateral trade measures to protect the global environment. Clearly, the failure of the U.S. tonegotiate seriously with the complainants figures prominently in the AB's finding that,

cumulatively, a number of features of the application of the U.S. scheme amounted to

"unjustified discrimination." However, the AB never held that the requirements of the chapeau,in and of themselves, impose a sui generis duty to negotiate. Rather, the AB's Shrimp/Turtle

ruling stands for the more limited propositions that (1) undertaking serious negotiations with

some countries and not with others is, in circumstances such as these, "unjustifiablediscrimination," and (2) that a failure to undertake serious negotiations may be closely connected

with, and indeed part and parcel of, various discriminatory effects of a scheme, and mayreinforce or perhaps even tip the balance towards a finding that those discriminatory effects

amount to "unjustifiable discrimination" within the meaning of the chapeau. By taking each of

these propositions separately and carefully examining them in context, we can discern the extent

to which the AB actually infers a duty to negotiate from the requirements of the chapeau, and theextent and nature of that duty.

Within GATT/WTO jurisprudence, offering different terms of market access to some

Members and not others will almost always constitute "discrimination." Thus, it is hardly

controversial that by offering negotiated market access to some Members and not others, theU.S. was engaging in "discrimination." One does not need to infer any self-standing duty to

negotiate in order to arrive at this conclusion. However, the AB had to consider not only whetherthere was discrimination, but also whether that discrimination was unjustifiable. In other words,could it be justified in terms of the objective of the United States, the protection of endangered

species of sea turtles? To answer this question, the AB examined international environmental law

related to biodiversity. The AB had already used this body of international environmental law indefining the meaning of exhaustible natural resources in XX(g), and it had justified proceeding

this way by pointing to the reference to sustainable development in the Preamble of the WTO

Agreement.


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Citing the Rio Declaration and other sources of international environmental law, the AB held

that trans-boundary or global environmental problems should be dealt with to the greatest extentpossible through cooperation and consensus, and unilateralism should be avoided to the greatest

extent possible. n38 On this understanding of the appropriate approach to global environmental

problems, it would indeed be very difficult to argue that the U.S. could be justified in not

offering serious negotiations to all relevant countries. But here the AB was not incorporating intothe chapeau a duty to negotiate from international environmental law. It was merely using a

baseline from international environmental law to determine whether, in the circumstances, the

discriminatory behavior of the U.S. was also unjustifiable.

Had the AB intended to read into the chapeau a self-standing duty to negotiate seriously, it

would have given some guidance as to the extent of the duty and its relationship to a

corresponding duty of good faith on those countries who are invited into negotiation. After all,

the duty of cooperation to solve international environmental problems that is found in theinternational environmental instruments that the AB cited is a duty on the part of all states who

are affecting the commons problem at issue. Thus, the duty to cooperate to solve international

environmental problems can be understood not only as a discipline on the country contemplating

unilateralism; it also can be regarded as a possible justification for unilateral measures. That is,unilateral measures can be imposed if a country refuses to negotiate in good faith towards a

cooperative solution to a commons problem.

But since the AB was not reading a self-standing duty to negotiate into the chapeau, it did notneed to expand on these complexities. The U.S. was required to negotiate seriously with the

complainants exactly to the extent it had already negotiated with the western hemisphere

countries, no more and no less. Given the confusion on this point, it bears repeating: The"unjustified discrimination" was not the failure to negotiate as such, but the failure to treat the

complainants as well as the U.S. had treated the western hemisphere countries. n39

The first AB ruling has been interpreted erroneously to stand for the proposition that failure

to negotiate is a component of another element of unjustified discrimination: the rigid applicationof a unilateral scheme without regard for different conditions in different countries. The

importance of negotiation to the operation of environmental trade measures is not discussed oreven referred to in the AB's second ruling. This is apparently because the AB found, in its second

ruling, that the U.S. was able to build into unilateral operation of its scheme sufficient flexibility,

by certifying countries that had a program comparable in environmental effectiveness, even if itworked differently than the domestic U.S. regulation. In other words, the AB suggests that if a

Member has adequately accounted for different conditions in different countries, then whether

that country has engaged in negotiation may be irrelevant for purposes of the chapeau. n40

In considering the question of flexibility, the AB's second Shrimp/Turtle ruling also madeclear that a Member is not required to sacrifice the achievement of its environmental objective to

any extent whatsoever in order to accommodate different conditions in different countries. Someinterpretations of the original report, notably by Professor Joel Trachtman, had found the AB to

be engaged in a balancing analysis in its application of the chapeau. n41 However, in theShrimp/Turtle 21.5 Report, the AB stated unambiguously that, consistent with the chapeau, a

Member imposing environmental trade measures may require a program comparable in

effectiveness to that which exists in the Member's own domestic law. n42 A Member need not gofurther in accommodating affected Members - for example, it need not adjust the statutory or


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regulatory requirements to the particular circumstances of each country, as long as it provides a

reasonable mechanism for assessing whether any country's program is comparable. n43

An even more serious misreading of the AB's invocation of international environmental lawwith respect to the duty of cooperation is that the AB held that global environmental trade

measures may only be taken, if at all, pursuant to an already negotiated multilateral framework.

In other words, a Member not only has a duty to negotiate but to actually succeed in achieving amultilateral framework under which trade measures are permissible (or required), before taking

such measures. n44 This reading simply ignores the exact wording of the international

environmental instruments cited by the Appellate Body. These instruments require cooperationand the avoidance of unilateralism "as far as possible." n45 This wording clearly anticipates that

there will be situations where it will not be possible to avoid unilateralism. If it were not the case,

then the language "as far as possible" would be utterly inutile. One of the cornerstones of the

AB's approach to WTO interpretation, established in the earlier Japan Alcohol and ReformulatedGasoline cases is that interpretations of treaty provisions should be avoided that render other

treaty provisions useless or meaningless.

In the Shrimp/Turtle 21.5 Report, the AB puts to rest any misunderstanding concerning the

need to conclude a multilateral environmental agreement:

Requiring that a multilateral agreement be concluded by the United

States in order to avoid "arbitrary or unjustifiable discrimination' in

applying its measure would mean that any country party to thenegotiations with the United States, whether a WTO Member or

not, would have, in effect, a veto over whether the United States

could fulfill its WTO obligations. Such a requirement would not bereasonable. n46

There is nothing in the wording of the chapeau (or any other part of Article XX) to suggest that anation must first secure agreement by WTO Members or any other nation before exercising its

rights under Article XX(g). By contrast, where the drafters wanted to make the exercise of somekind of exception to GATT disciplines contingent on agreement or collective action among

Members or states generally, they did so explicitly. For example, Article XXI(c) provides an

exception where Members are taking action "in pursuance of ...obligations under the UnitedNations Charter for the maintenance of international peace and security."

V. COUNTRY-BY-COUNTRY VS. SHIPMENT-BY-SHIPMENT CERTIFICATION

Malaysia's challenge to the United States' revised turtle-friendly trade measures focused in

part on the proper interpretation of the chapeau's "flexibility" requirement. The 21.5 disputeresolution panel had found that certification of countries with programs of comparable

effectiveness was not sufficient to satisfy the chapeau. It was essential as well, according to thepanel, that the United States was now admitting certified turtle-friendly shipments from non-

certified countries. n47 Thus, according to the panel, even if the U.S. altered the application of

the scheme so as to provide other countries' governments with adequate flexibility to achieve theenvironmental objective through different types of policies, it would still also have to allow in

shrimp from countries with turtle conservation policies that do not meet even these new flexible


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requirements, provided that the particular shipment of shrimp happens to have been fished in a

turtle-friendly manner.

In its appellate submission, Malaysia argued that, although the United States' revisedguidelines permitted shipment-by-shipment certification, there was litigation before the U.S.

courts challenging this aspect of the revised guidelines as inconsistent with the requirements of

the statute. Thus, the U.S. implementation, in as much as it required shipment-by-shipmentcertification, was legally insecure. The Appellate Body rejected this argument, noting that it

could only assess conformity on the basis of existing legal facts, and could not speculate as to

future decisions of the U.S. courts. n48

The AB's ruling, however, does not answer the underlying question of whether shipment-by-shipment certification is a sine qua non for the operation of this kind of scheme consistent with

the requirements of the chapeau of Art. XX. One should first of all note that shipment-by-

shipment inspection was not presented as a separate requirement implicit in the chapeau by theAB in its original ruling. Rather, the AB had mentioned the absence of shipment-by-shipment

inspection as evidence that the administrators of the U.S. law were treating the statutory scheme

more in the manner of an extraterritorial extension of U.S. domestic law than as a global

conservation measure. n49 In other words, the AB was pointing to a number of factors thatsuggested inadequate appreciation by the administrators of the character of the statutory scheme,

and above all its focus on conservation of the global commons rather than on bringing foreign

actors under the ambit of United States law. Such lack of appreciation could explain the variouselements of inflexibility that, cumulatively, amounted to unjustified discrimination within the

meaning of the chapeau.

The United States did not appeal the panel's interpretation that, absent shipment-by-shipment

certification, the revised U.S. scheme would not conform with the chapeau's flexibilityrequirement. One reason for this decision may be that, in defending the shipment-by-shipment

approach against domestic court challenges, the executive branch of the U.S. government would

actually have found helpful a panel ruling that such an approach was actually required underArticle XX to meet the U.S.'s WTO obligations.

Nevertheless, in its 21.5 ruling the Appellate Body notably does not include shipment-by-

shipment certification as even one aspect of the flexibility required by the chapeau, let alone as aseparate sine qua non requirement. Here it is important to reflect on the AB's re-emphasis of

paragraph 121 in its original ruling. As discussed above, the AB suggests in that paragraph that

there is nothing in the overall structure of Article XX that would prevent a member fromconditioning imports on whether Members comply with or adopt a policy or policies unilaterally

prescribed by the importing Member. Indeed, in that paragraph the AB made the even stronger

statement that if such policy-conditioned measures were excluded from the ambit of Article XX,this would render "most, if not all, of the specific exceptions of Article XX inutile... ."

Malaysia had argued that this statement in paragraph 121 was mere dicta. In its 21.5 ruling,

the AB held that, to the contrary, "this statement expresses a principle that was central to our

ruling in United States-Shrimp." n50 If the United States law were to be interpreted by the courtsas excluding shipment-by-shipment certification, it would still be, in principle, justifiable under

Article XX. According to the AB, Article XX contemplates measures that condition market

access not only on the practices of foreign producers, but on the adoption of certain policies by

the WTO Member state from whence the product originates.


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To say that the chapeau requires shipment-by-shipment inspection in the application of the

U.S. scheme would be to interpret the chapeau in a manner that is inconsistent with the AB'soverall understanding of the structure and purpose of Article XX, as articulated in paragraph 121

of its original ruling, and reaffirmed with emphasis in paragraph 138 of its 21.5 ruling. Since the

United States could conceivably have a law that explicitly excludes shipment-by-shipment

inspection, conditioning all market access on the turtle conservation policies of the country oforigin, it makes no sense that the chapeau would be a per se bar to application of the law in a

manner that excludes shipment-by-shipment inspection. On the other hand, on the facts, where

administrators are applying a statute in a manner that is more trade restrictive than its ordinarymeaning as interpreted by the courts, then this extra, legally un-mandated degree of trade

restrictiveness could constitute evidence of unjustified discrimination (as the AB found in its

original ruling).

One puzzle concerning paragraph 121 of the original AB report is why the AB regarded mostof Article XX as inutile, unless it allowed for market access to be conditioned on the policies of

exporting Members. To find that Article XX may contemplate in some situations these kinds of

measures is one thing, but to consider that Article XX is mostly about such measures is quite

another. This puzzle can be approached by considering the counterfactual situation that the U.S.measure was concerned only with shipment-by-shipment certification and did not in any way

predicate market access on the government policies of other WTO Members. How could ArticleXX be considered inutile in such a situation?

The only plausible explanation is that such process-but-not-policy-based measures do not

violate any operative provision of the GATT in the first place. Therefore, Article XX is, by and

large, not necessary to justify them. Thus, if the United States had a law that stated that allshrimp, whether they are caught in the U.S. or elsewhere in the world, must be caught in a turtle-

friendly manner in order to enter the U.S., such a measure could be regarded as consistent with

the National Treatment obligation in the GATT Art. III:4, because it provides "no less favorabletreatment" to like imported products. Such a measure would arguably not be discriminatory,

because it would deal only with a characteristic of the product, its method of production, and notdistinguish between different countries and their turtle-conservation policies.

However, the conventional wisdom in traditional GATT/WTO circles is that regulations that

treats products differently on the basis of their process of production (e.g. whether a given

shrimp has been fished with a turtle-friendly or turtle-deadly method) are per se violations of theGATT, and they can only be justified under Article XX. I have challenged this product/process

distinction in other scholarship; n51 the AB's remark that Article XX would be largely inutile

unless it could be used to justify measures conditioned under other countries' policies suggests

that the AB itself may not subscribe to the conventional wisdom of the product/processdistinction. Rather, the AB may view Article XX as unnecessary for purposes of justifying

measures that condition market access on how the imported product is produced, rather than onsome kind of policy in the country of origin of the imported product. n52

Indeed, in its Asbestos ruling, n53 the AB appears to have left the door open for thepossibility that non-discriminatory process-based measures are consistent with Article III:4. First

of all, it held that in determining whether products are "like," the physical characteristics of

different products, and their relevance to "likeness" must be assessed in a purposive manner, inlight of the objectives of Art. III as a whole - above all the avoidance of protective discrimination

against imports. For Article III:4 purposes, no particular physical characteristic is dispositive, in


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the abstract, of whether a product is "like" or unlike. Other factors, such as consumer

preferences, must be considered in forming a judgment based on the criteria that the AppellateBody approved in Japanese Alcohol and subsequent cases for assessing likeness in the context of

Art. III:2, which deals with National Treatment in taxation. Moreover, there may be additional

criteria or factors that could be decisive, besides those already developed in the taxation cases.

Perhaps of even greater significance in assessing whether the product/process distinctionforms any real part of the WTO jurisprudence is the dictum of the AB in Asbestos that, even

where two products are deemed to be "like" for purposes of Article III:4, they may still be treated

differentially in regulation, provided that the result is treatment "no less favorable" for the"group" of imported products compared against the "group" of like domestic products. Thus,

arguendo, if a panel were to hold that turtle-friendly and turtle-unfriendly shrimp were "like"

products, it would still need to consider whether treating turtle-unfriendly shrimp differently

would lead to less favorable treatment of imported shrimp as a group than domestic shrimp as agroup. This would require a judgment as to whether, in singling out turtle-unfriendly shrimp, the

regulatory scheme in its structure, design and operation, is systematically biased against

imported shrimp as a group. A scheme that was even-handed between imports and domestic

shrimp, and focused appropriately on conservation goals, might well pass this test.

Reflecting on the product/process distinction in light of the original AB ruling in

Shrimp/Turtle, John Jackson predicted "the product-process distinction will probably not survive

and perhaps should not survive." n54 However, Jackson also rightly notes that since there is noruling where the AB has explicitly treated a process-based measure as consistent with National

Treatment, the issue "remains open." n55 I believe that, in the respects discussed above, the

Asbestos ruling strengthens Jackson's prediction.

VI. CRITICISMS OF THE AB RULINGS IN SHRIMP/TURTLE

Having swept away almost all the pillars of the GATT anti-environmentalist edifice, it is notsurprising that the AB would be criticized for illegitimate judicial activism. A fairly

representative criticism is that of Jagdish Baghwati of Columbia University:

I have some sympathy for [the] view that the dispute settlement

panels and the appellate court must defer somewhat more to the

political process instead of making law in controversial matters. Iwas astounded that the appellate court, in effect, reversed long-

standing jurisprudence on process and production methods in the

Shrimp/Turtle case. I have little doubt that the jurists werereflecting the political pressures brought by the rich-country

environmental NGOs and essentially made law that affected thedeveloping countries adversely. n56

The only "jurisprudence" clearly establishing the principles to which Bhagwati is referring

consists in the two unadopted Tuna/Dolphin panel reports. Although unadopted, these reports

embody a perspective almost universally held by the trade-insider network. Was it "activist" ofthe Appellate Body not to defer to that insider perspective, but instead to go back to the treaty

texts themselves and to sources of interpretation authorized by the Vienna Convention on the


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Law of Treaties? As a matter of positive law, the Appellate Body had already established in early

cases that while unadopted GATT reports may offer "guidance," there is no legal requirement totake them into account when deciding cases within the dispute settlement framework of the

WTO. n57 In terms of the structure of dispute settlement and the mandate of the Appellate Body

in the WTO system, a somewhat more elaborate answer is required.

According to the Dispute Settlement Understanding, the system:

serves to preserve the rights and obligations of Members under the

covered agreements, and to clarify existing provisions of those

agreements in accordance with customary rules of interpretation ofpublic international law. Recommendations and rulings of the

Dispute Settlement Board (DSB) cannot add to or diminish rights

and obligations provided in the covered agreements. n58

Based on this mandate, it was not within the power of the Appellate Body to defer to any kind of

insider understanding of the limits on Article XX. The AB was required to go back to the

provisions themselves and read them, not in light of the GATT tradition or practice as such, butrather "in accordance with customary rules of interpretation of public international law." n59

It is hardly surprising that once it repaired to the text, the Appellate Body found no support

for the kind of limit on the application of Article XX that was opined by the panel in

Tuna/Dolphin and in a rather revised version at the panel level in Shrimp/Turtle. The textualfoundation just isn't there. The limit in question was generally not argued in any case as a textual

matter. Rather, arguments for such limitations were based on the need to prevent what John

Jackson has referred to as a "slippery slope" n60 - the infinite possibilities for restricting tradethat might arise if it were possible to restrict market access based upon value-based judgments of

other countries' policies. One may take issue with this view of the structural requirements of the

multilateral trading system, as I have in other work, but even if the Appellate Body agreed withthat view, it was prevented from adding to the obligations or diminishing the rights to be found

in the textual provisions of Article XX. Given the mandate of the Appellate Body under theDSU, to have done otherwise than it did would have been illegitimate and indeed illegal judicial

activism.

DSU 3.2 doesn't absolutely confine dispute settlement organs to the text itself. Rather, they

cannot go beyond the text as interpreted using the customary rules of treaty interpretation inpublic international law. These rules, especially as codified in Articles 31 and 32 of the Vienna

Convention on the Law of Treaties, place considerable emphasis on the ordinary meaning of the

text, interpreted in light of context, object and purpose. The Vienna Convention Article 31allows context, object, and purpose to be taken into account in interpreting the exact words of the

treaty in their "ordinary meaning," but it does not contemplate that they can be used to fill gapsor to supplement the text itself with, as it were, unwritten law or unstated structural principles. In

short, context, object or purpose cannot be a basis for reading into the text a diminution of a rightor an increased obligation, unless the words themselves at least point to the application of such

extrinsic interpretive materials. Thus, the two aspects of DSU 3.2 are to be read together, namely

the obligation not to add to or diminish the rights and obligations in the treaty text, and therequirement to interpret the text according to the customary public international law rules of

treaty interpretation, which are to a significant extent codified in the Vienna Convention.


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Is there nevertheless a place within the Vienna Convention rules for bringing in the insider

understanding that critics of the AB ruling in Shrimp/Turtle believe ought to have been decisive?Section 31(3) of the Vienna Convention does provide for the taking in account of "any

subsequent practice in the application of the treaty which establishes the agreement of the parties

regarding its interpretation." n61 Would the insider understanding qualify as such an agreement?

The answer is clearly "no," because one of the parties, the United States, obviously had beentaking a different view of Article XX. (This is true even though many American trade officials,

at a personal level, may have shared the insider understanding.) Had the United States not

invoked Article XX as applicable in both Tuna/Dolphin cases or had those rulings been adopted(i.e. accepted by the WTO Membership as legally binding settlements of the dispute) then

matters might have been different. But even in that case, there would still be an issue as to

whether the evidence was strong enough to constitute "agreement" concerning interpretation.

The "judicial activism" critique of the AB's Shrimp/Turtle ruling has another dimension oralternative formulation. It has been argued that the law regarding "unilateral" global

environmental trade measures was a matter of controversy at the time of the Shrimp/Turtle case,

and that the Appellate Body over-reached in resolving a controversy that, given the sensitivities

involved (including the delicate North-South issues), should properly have been settled throughnegotiation, not litigation. Now the Appellate Body was required n62 to decide the appeal, and

however the appeal was decided, it is hard to imagine that the AB would not find itself on oneside of the controversy or the other, merely by virtue of having to make a legal ruling. Moreover,

in making one of the functions of the dispute settlement organs clarification of the law, DSU 3.2

supposes that the Appellate Body will not decline to rule in areas where the law is unclear. As

Coase and his followers have impressed on us, bargaining always takes place in the shadow ofthe law, and whatever decision the AB made concerning the law would have some effect on

future negotiations. In sum, the AB was not institutionally situated such as to be neutral or

completely deferential to a political determination of the problem posed by the Shrimp/Turtledispute.

Moreover, I believe that even if the AB's sole concern had been judicial in such a situation, itstill would have acted just as it did. To understand why, we have to again consider some

foundational principles of public international law. One of these, established in the Lotus case,

n63 is that the sovereignty of states is plenary in the absence of specific legal constraints to the

contrary. One does not presume, or presume lightly, that the sovereignty of states is restricted.Moreover, in the Nicaragua case, the International Court of Justice held that there was no rule of

customary public international law that prevented a state from taking economic measures in

response to policies of another state. n64 In the circumstances, the anti-judicial-activismprinciple would weigh against imposing on the United States any legal constraint on its

sovereignty not clearly authorized by the GATT treaty. Thus, in the presence of controversy over

the limits of Article XX, a conservative judicial body would have adopted the interpretation that

supposes the least interference with the sovereignty of the U.S. n65

A third version of the judicial activism critique of the Shrimp/Turtle AB ruling focuses on

the general notion that the AB somehow should have stepped aside, and allowed the controversy

to be resolved politically. This third version of the critique gives a great deal of attention to theway in which the AB brought in materials from international environmental law and policy in

resolving the meaning of the expression "exhaustible natural resources" in Art. XX(g). As

discussed above, the AB explicitly rejected the view that the meaning of "exhaustible natural


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resources" was frozen at the time the GATT was negotiated and, invoking the preamble of the

WTO Agreement and its reference to sustainable development, considered that the meaning of"exhaustible" had to be understood in evolutionary terms, in light of the development of

international environmental law, science, and policy. The complainants in Shrimp/Turtle had

argued that the meaning of "exhaustible" did not include living species, but only mineral

resources and the like. Whether this was indeed a fixed and uncontroversial meaning of theexpression in 1947 is not in itself obvious. And, as the AB pointed out, in two adopted GATT

rulings, migratory fish species had already been deemed to be "exhaustible natural resources."

It is well established public international law that some provisions of treaties are to beinterpreted in an evolutionary fashion. By reverting to the preamble of the WTO Agreement to

establish that exhaustible natural resources is an evolutionary term, the Appellate Body merely

followed Vienna Convention Article 31, which specifically mentions the "preamble" as part of

the "context" which is fundamental to the interpretation of treaty text. However, the "preamble"in question was one that was written nearly 40 years after the original GATT text. The AB was

implicitly accepting the notion that there is a new framework for the interpretation of GATT -

that the creation of the WTO represented a foundational moment, one that in this case placed the

relevant provisions of GATT within a broader universe of international law and policy relevantto environment and development, as well as general public international law.

Of course, the insider network, generally speaking, had boasted of the creation of the WTO

as a new founding for the multilateral trading system, including the placement of the system on amore unambiguous, or unquestionable, foundation of international legality. They do not like to

reap what they have sown.


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FOOTNOTES:

n1. Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and

Their Disposal, Mar. 22, 1989, UN Doc. EP/IG.80/3, reprinted in 28 ILM 649 (1989).

n2. Where trade measures are based upon the environmental practices of the exportingcountry, they only create an incentive for environmentally-friendly practices where producers are

producing for export; a measure that conditions imports on an environmentally-friendly process

or production method has no incentive effect on firms producing exclusively for the domesticmarket . On the other hand, where trade measures seek to change the environmental policies of

the exporting country, the country in question may simply decide to pay the price for its lack of

adequate environmental policies in the form of reduced exports rather than changing the policies.Thus, not only is environmental protection not improved, but one experiences the kind of

economic welfare losses typically associated with trade restrictions. See Robert Howse &

Michael J. Trebilcock, The Fair Trade-Free Trade Debate: Trade, Labor, and the Environment, inEconomic Analysis of International Law (Alan O. Sykes & Jagdeep S. Blandiri eds., 1996).

n3. See Ronald H. Coase, The Problem of Social Cost, 3 J. L. & Econ. 1 (1960).

n4. Howard F. Chang, Carrots, Sticks, and International Externalities, 17 Int'l. Rev. L. &

Econ. 309 (1997).

n5. There were arguably subtle elements of discrimination in that the rules were not identical

for foreign and domestic producers, with the former required to adhere to a compliance regimeentailing arguably higher compliance costs. However, as discussed in the text, the panel, rather

than simply finding fault with the measure on these rather narrow grounds, created a sweeping

rule against trade measures to protect the global environment.

n6. The Tuna/Dolphin panels held that the measure was a violation of the GATT in the first

place because, even if non-discriminatory, measures that distinguish products on the basis oftheir method of production (as opposed to physical characteristics of the products) areprohibitions on imports within the meaning of Art. XI of the GATT). This interpretation of the

GATT is challenged by R. Howse and D. Regan, infra note 50.

n7. GATT Dispute Panel Report on U.S. Restrictions on Imports of Tuna, Sept. 3, 1991,GATT B.I.S.D. (39th Supp.) at 155 (1993).

n8. Under the GATT, prior to the establishment of the World Trade Organization in 1995, in

order to constitute a legally binding resolution of a dispute, a panel ruling had to be adopted by

consensus of the member states, meaning their diplomatic representatives sitting as the DisputeSettlement Body. With the creation of the WTO, this rule was changed fundamentally. Panel

rulings are automatically adopted, unless there is a consensus against adoption. Panel rulings,

however, are subject to appeal to the WTO Appellate Body. The new negative consensus rule

similarly applies to rulings of the Appellate Body.

n9. GATT Dispute Panel Report on U.S. - Restrictions on Import of Tuna, June 16, 1994, 33I.L.M. 839 (1994).In this second Tuna/Dolphin ruling, the panel rejected the territorial limitation

that the first Tuna/Dolphin panel had placed on Art. XX, instead suggesting that Article XX (b)

and (g) could not apply to measures that would only be effective in protecting the environmentwere other countries to change their policies. This restriction seems based on a misunderstanding


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of economics. Even if the exporting country does not change its policies, the reduction of

imports of dolphin-unfriendly tuna will at the margin lead to less dolphin-unfriendly tuna beingproduced, and therefore fewer dolphins being killed. However, as noted in footnote 2, it is true

that measures such as this are under-effective in protecting the environment, unless they induce

the target country to change its policies. The panel was wrong to assume that there would be no

positive environmental effect whatever, absent a policy change.n10. Thus, the opening paragraph of Article XX suggests that, subject to the conditions in the

chapeau (that the measures not be applied in a manner that constitutes arbitrary or unjustified

discrimination or a disguised restriction on trade) "nothing in this Agreement shall be construedso as to prevent" Members from taking measures for the purposes listed in the various heads of

Article XX. Neither the language nor structure of Article XX excludes such measures even

where they significantly limit or curtail trade liberalization, provided they are connected in the

appropriate way to the objectives stated in the various paragraphs.

n11. See, e.g., Philip M. Nichols, Corruption in the World Trade Organization: Discerning

the Limits of the World Trade Organization's Authority, 28 N.Y.U. J. Int'l L. & Pol'y 711 (1998).

n12. WTO Appellate Body Report on U.S. - Import Prohibition of Certain Shrimp andShrimp Products, WT/DS58/AB/R (October 12, 1998) [hereinafter Shrimp/Turtle], available athttp://www.wto.org/english/tratop e/dispu e/distabase e.htm.

n13. Report of the Appellate Body, U.S. - Import Prohibitions of Certain Shrimp & Shrimp

Products; Recourse to Article 21.5 of the DSU by Malaysia, WT/DS58/AB/RW (Oct. 22, 2001)

[hereinafter Shrimp/Turtle 21.5 Report], available at http://www.wto.org/english/tratope/dispute/distabase_e.htm.

n14. See The Convention on International Trade in Endangered Species of Wild Fauna and

Flora, March 3, 1973, app. I, 27 U.S.T. 1087, 1118;993 U.N.T.S. 243, 257.

n15. Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies

Appropriations Act of 1990, Pub. L. 101-162, 609, 103 Stat. 988, 1037-38 (codified atEndangered Species Act of 1973 (ESA), 16 U.S.C. 1537(1994)).

n16. Id. at 609(a)(1), (2).

n17. Id. at 609(a)(3), (4).

n18. Id. at 609(a)(5).

n19. Id. at 609(b)(1), (2).

n20. Earth Island Inst. v. Christopher, 20 C.I.T. 1221, 942 F. Supp. 597 (Ct. Int'l Trade1996), vacated on other grounds,Earth Island Inst. v. Albright, 147 F.3d 1352 (Fed. Cir. 1998).

n21. Id. at 604-05.n22. Earth Island Inst. v. Christopher, 20 C.I.T. 1389, 948 F. Supp. 1062 (Ct. Int'l Trade

1996).

n23. Id. at 1070.

n24. Shrimp/Turtle, supra note 12, P 112.


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See Grainne de Burca & Joanne Scott, The Impact of the WTO on EU Decision-making, in The

EU and the WTO: Legal and Constitutional Issues, 16-22 (de Burca & Scott eds., 2001).

n38. Shrimp/Turtle, supra note 12, PP 168-69.

n39. Of all the commentary on the AB ruling, only that of Howard Chang seems to haveclearly grasped this point. See Chang, supra note 36.

In the Shrimp/Turtle 21.5 Report, the AB clarified that the duty of negotiation under the

chapeau simply amounted to a requirement to make a "comparable negotiating effort" with the

complainants, i.e., comparable to what the U.S. had invested in the case of the westernhemisphere countries. The implication is that, had the U.S. negotiated with no-one, it would not

have run afoul of the chapeau. Shrimp/Turtle 21.5 Report, supra note 27, PP 122-23.

n40. Of course, even if the application of a unilateral measure is sensitive to differing

conditions, it is impermissible for a nation to negotiate seriously with some countries but notwith others.

n41. See Joel P. Trachtman, Trade and ... Problems, Cost-Benefit Analysis and Subsidiarity,

9 Eur. J. Int'l L. 32 (1998).n42. Shrimp/Turtle 21.5 Report, supra note 27, PP 144.

n43. Id. P 149.

n44. This is the interpretation of the ruling offered for example by Gary Sampson:

The absence of an MEA to deal with turtle protection proved

critical... . On the facts of the case, it found that, among other

things, the failure to have established an environmental agreementas an instrument of environmental protection policy had resulted in

a unilateralism which was discriminatory and unjustifiable... ."

Gary P. Sampson, Effective Multilateral Environmental Agreements and Why the WTO Needs

Them, 24 World Economy 1109, 1126 (2001).

n45. Rio Declaration on Environment and Development, prin. 12, U.N. doc.A/CONF.151/5/Rev.1 (1992), 31 I.L.M. 874, 878 (1992).

n46. Shrimp/Turtle 21.5 Report, supra note 27, P 123.

n47. Id. P 106.

n48. Id. PP 93-95. Recently, in fact, the court upheld the shipment-by-shipment interpretation

of the statute.

n49. Shrimp/Turtle, supra note 12, P 165.

n50. Shrimp/Turtle 21.5 Report, supra note 27, P 138.

n51. See, e.g., Robert Howse & Donald Regan, The Product/Process Distinction - An

Illusory Basis for Disciplining "Unilateralism" in Trade Policy, 11 Eur. J. Int'l L. 249 (2000).

n52. Id. For a critique of Howse and Regan, see the article by Sanford Gaines in this

symposium issue, 27 Colum. J. Envtl. L. 383 (2002).


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n53. Asbestos, supra note 29. The interpretation of this ruling that follows is elaborated at

length in Robert Howse & Elizabeth Tuerk, in The WTO Impact on Internal Regulations-A CaseStudy of the Canada-EC Asbestos Dispute, The EU and the WTO: Legal and Constitutional

Issues, supra note 36.

n54. John H. Jackson, The Limits of International Trade: Workers' Protection, the

Environment and Other Human Rights, 94 Am. Soc'y Int'l L. Proc. 222, 224 (2000).

n55. Id.

n56. Jagdish Bhagwati, After Seattle: Free Trade and the WTO, in Efficiency, Equity, andLegitimacy: The Multilateral Trading System at the Millennium 60-61 (Roger B. Porter et al.

eds., 2001). See also Claude E. Barfield, Free Trade, Sovereignty, Democracy: The Future of the

World Trade Organization, at Ch. 4 (2001).

n57. Appellate Body Report on European Communities - Customs Classification of CertainComputer Equipment, WT/DS62/AB/R, WT/DS67/AB/R, WT/DS68/AB/R (June 5, 1998)

[hereinafter LAN Equipment], available at http://www.wto.org/english/tratop

e/dispute/disputestatus_e.htm; Appellate Body Report on Japan - Taxes on Alcoholic Beverages,WT/DS8/10/11/AB/R (November 8, 1996), available at http://www.wto.org/english/tratop

e/dispute/disputestatus_e.htm.

n58. Understanding on Rules and Procedures Governing the Settlement of Disputes, Apr. 15,

1994, art. 3.2, Marakesh Agreement Establishing the World Trade Organization, Annex 2, LegalInstruments - Results of the Uruguay Round vol. 31, 33 I.C.M. 1125, 1127 (1994).

n59. Id.

n60. Jackson, supra note 53.

n61. Vienna Convention on the Law of Treaties, May 23, 1969, 1155 U.N.T.S. 331.

n62. This is a point that is not well understood by non-lawyer critics of judicial activism such

as Claude Barfield. There is no equivalent of a "political question" doctrine that would allow theAppellate Body to decline to address the claims put to it on appeal - the AB is bound by the DSU

to address those claims, albeit not all the arguments the parties or third parties may make aboutthe claims.

n63. The Case of the S.S. "Lotus," Judgment 9, 1927, PCIJ, Series A, No. 10, p. 19.

n64. Military and Paramilitary Activities (Nicar. v. U.S.), 1986 I.C.U. 14, 125-26.

n65. See Report of the Appellate Body, E.C. Measures Concerning Meat and Meat Products,

# 172, WT/DS28/AB/R, WT/DS46/AB/R (January 16, 1998) (invoking the principle of in dubiomitius), available at http://www.wto.org/english/tratop e/dispute/dispute.htm#Top.

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